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By M. B. Dusseault, A. Pirayehgar

"There is concern that hydraulic fracturing (HF) near an existing critically stressed fault could trigger slip and generate a seismic event of significance. To this end, a mathematical discontinuum model representing a naturally fractured rock (NFR) mass containing a fault is created, and fault slip response to fluid injection is studied. UDECTM is used as a Discrete Element Method (DEM) approach to define the seismic moment, and also to assess the influence of injection and slip on further shear slip propagation. In most of the simulations, slip and dilation take place along a number of oriented fracture surfaces, so it is reasonable to assume that in a real case, microseimic emissions would accompany each slip “event”. The moment magnitude scale (Mw) is used to measure the size of the microseismic event in terms of the energy released. Seismic moment is a measure of the total energy (work) released during a seismic event and is used to measure its size. From another aspect, the injection energy is calculated as the total energy required for achieving the hydraulic fracturing; this is viewed as energy to open fractures against the ambient stress field and much of it is potential stored energy that can be released and create discontinuities (work of fracture), deformations (W=F·d), heat and radiated seismic energy. A small amount of the total released energy is transformed to radiated seismic energy and another small amount results in tensile fractures. Fracture energy is used to calculate the work required to create fracture surfaces. Comparing the energy release by fracturing or seismic events indicates their contribution to the total amount of released energy or total work. The amount of energy associated with the stick-slip event is small compared with the overall work done to generate the distortions (i.e. increases in aperture by forcing them open) in the rock mass, and much of the energy in slip is lost as heat from the plastic deformation, rather than as radiated seismic energy.Microseismic monitoring shows the spatial distribution and magnitude of seismicity associated with slip of bedding planes and natural and incipient fractures. Work calculations have been undertaken to look at the various sources of energy storage (elastic strain energy) or dissipation (slip), and likely the energy losses from viscous dissipation could be addressed as well, helping to clarify HF processes in NFRs."

Jan 1, 2015

By B. R. Boardman

Project Environmental Approval is a multi-faceted issue. From a mining perspective, it is a costly item because of avoidable time delay. The government perspective is that the approvals are a necessary part of meeting departmental requirements to ensure that the wellbeing of other uses of the environment is maintained. This paper outlines some of the problems inherent in the environmental approvals process and makes recommendations to both the proponent and government about improving the efficiency of the process.

Jan 1, 1978

By Youngjib Ham

Understanding energy performance of existing buildings is vital to increasing their efficiency and reducing the overall energy consumptions. This entails facility managers to systematically monitor building energy performance and reliably identify and analyze potential problems. Currently, infrared thermography is widely used as a primary diagnostic tool for the detection of building performance problems. Nonetheless, applications of thermal images for building inspection are mainly restricted to manual and labor-intensive identification and qualitative assessment of heating or cooling loss. Automated identification of potential problems and reliable cost analysis of the associated energy loss can help homeowners to minimize financial risk of retrofits and maximize energy savings. To that end, this paper presents a new automated method for calculating the cost of energy loss for building diagnostics. In the proposed method, first, using a hand-held thermal camera, the auditors collect digital and thermal imagery from the buildings under inspection. Then, using a recently proposed method for Energy Performance Augmented Reality (EPAR) modeling, an actual 3D spatio-thermal model is generated and superimposed with a computational fluid dynamics (CFD)-based expected energy performance model. The resulting EPAR model is placed into the method proposed in this paper for cost analysis of the energy loss. Through a new 3D thermal mesh modeling using k-d tree structure and nearest neighborhood searching, performance deviations between these models are automatically calculated. Using a temperature threshold, the areas associated with potential performance problems are detected in the EPAR model and are visualized using a metaphor based on traffic light colors. Then, the actual R-values of the detected areas are measured at the level of 3D points. Based on the measured R-values and the estimated air change rate for the detected air leaks, (1) the heat loss or gain caused either by poor insulation or air infiltration/exfiltration and (2) the associated energy costs are automatically calculated. The proposed method is validated on several locations of existing residential buildings. The preliminary results show the potential of the proposed method for minimizing the inspection time as well as the risk associated with the cost analysis of retrofitting potential building performance problems.

Aug 1, 2013

By G. Stenning

The paper outlines the need for high-volume ventilation in a uranium mining operation based on the design to meet environmental requirements for dust, radiation and diesel equipment. Mining methods in a highly mechanized operation, a key factor in design, are discussed. The construction and installation of major intake and exhaust fans are described briefly, together with the development of the mine airways and distribution system. Controls in the form of doors and bulkheads are important considerations in planning. Finally, the need to lower ventilation requirements in response to increasing power costs will result in future improvements.

Jan 1, 1979

By G. F. MacDonnell

THE Privateer mine consists of a group of mineral claims situated in the Zeballos area, on the west coast of Vancouver island, approximately 180 miles north of Victoria. Although Zeballos is a comparatively new mining camp, its transportation facilities can be considered exceptionally good. General freight and supplies are brought in by either C.P.R. or Frank Waterhouse steamers from either Victoria or Vancouver. Service by these boats varies from five to ten days and the trip from Victoria takes approximately two days. Passengers may use the C.P.R. boats, or, if speed is essential, they may fly, in which case they have the choice of two flying companies, namely, Canadian Air-ways, Limited, and Ginger Coote Airways. The average flight from Vancouver takes approximately two hours. Excellent unloading facilities are provided at the beach by a government dock for the steamers and a floating dock for aeroplanes. The mine, which is approximately five miles from the beach, is serviced by a fairly good gravel road, which has proved satisfactory for all haulage purposes. Zeballos has the reputation of having one of the heaviest rainfalls on the west coast, but as no accurate records have been kept, no comparisons can be made. H. C. Gunning, in his report, comments on the weather from 1929 to 1932, and one would judge that the practically continuous rainfall did not add to the pleasures of the field work. During the summer of 1938, the opposite condition prevailed and the area had exceptionally dry and pleasant weather. The snowfall is generally light at the lower elevations, but very heavy higher up. No extreme cold weather is encountered during the winter, which is generally short.

Jan 1, 1939

By W. Griffith

"While oxalic acid precipitation practices are commonly applied on purified rare earth elements (REEs) pregnant leaching solutions (PLS), few efforts have been reported using oxalic acid (OXA) to recover REEs directly from untreated PLS. High oxalic acid demand is the most significant issue in all these direct oxalic precipitation (DOP) practices. Preliminary research on DOP of REE from a dilute PLS originating from an acid bake followed by water leaching was conducted. At 75°C, the oxalic acid demand was between 12 and 18 times the stoichiometric requirement for complete REE precipitation. Conducting DOP at 25°C had superior REE recovery but the product purity and filterability declined. Between 75°C and 100°C, REE recovery increased with increasing temperature. When sodium hydroxide was used to adjust the pH during DOP, in the range of 0.5 to 1.5, higher pH benefited REE recovery. Using ammonium hydroxide in place of sodium hydroxide, the REE recovery was reduced by close to 5%. Sodium chloride addition to the PLS was also investigated and the results showed that at both 75°C and 25°C, the REE recovery was enhanced substantially. At 25°C, when the oxalic acid addition was controlled at 4.7 times the stoichiometric requirement, the overall REE recovery reached 95% with the addition of 240 g/L NaCl. Other reagents such as KCl, NH4Cl also showed significant enhanced REE recovery at the same oxalic acid addition. The addition of sodium sulphate appeared to largely enhance the precipitation of LREE but inhibited the formation of HREE oxalate. All results indicate the formation of rare earth double salts may play an important role in REE DOP sulphate media.INTRODUCTIONThe conventional routes for recovering rare earth elements (REEs) from a sulphuric acid pregnant leaching solution (PLS) involves an initial purification step for removal of iron, aluminium for example by precipitation through neutralization, followed by precipitation of REEs as hydroxide, oxalate or carbonate salts, or by bulk solvent extraction for REE recovery (Xia, 2013). Another route was used by Bayan Obo in their historical flowsheet, where the PLS was first subjected to double sulphate precipitation, then the remaining REEs, mostly heavy rare earth elements (HREE), were recovered by oxalate precipitation (Li, 2011)."

Jan 1, 2016

By A. O. Sfriso

"Numerical modelling is becoming universal in rock engineering practice. Most applications focus on the prediction of failure loads of 2D problems, where the numerical models are useful extensions to analytical methods and experience-based design criteria. For 3D problems and problems where the assessment of serviceability indicators – displacements, ground-structure response, etc. – are of importance, the selection of the constitutive models themselves and the implications of the selection of material parameters may have a very heavy impact on the reliability of the model outcome and its predictive capability.This paper overviews basic common aspects of constitutive equations used in practical rock engineering and summarizes some challenges that are frequently observed when reviewing numerical models performed for routine problems in rock engineering. INTRODUCTIONNumerical methodsFrom a philosophical perspective models, either analytical or numerical, are idealizations of a perceived reality. For us engineers, models are just tools we use to guide our judgement and understanding of the problem in hand. When dealing with problems in rock engineering, we resort to a wide range of techniques:1. Closed form solutions like confinement-convergence methods for circular tunnels: these methods satisfy equilibrium and compatibility requirements at the cost of a crude simplification of the material behavior and geometry;2. Limit analysis methods, like bearing capacity formulas: lower bound methods satisfy equilibrium but sacrifice compatibility, and upper bound methods do the opposite. Material behavior must be simple, geometry admits limited freedom;3. Limit equilibrium methods, like method of slices for slope stability: they satisfy restricted forms of equilibrium, do not satisfy compatibility requirements, require simple material behavior but have a much greater flexibility on geometry;4. Numerical methods, where a mesh is employed to discretize the problem geometry: when properly formulated, these methods satisfy equilibrium and compatibility requirements and give reasonable approximations to the behavior of very complex geometries and construction sequences. Very little restrictions remain on geometry and material behavior, but the cost of calibrating the material parameters can be very high."

Jan 1, 2015

By A. R. Sorta, D. C. Sego

ABSTRACT Temperature, solute, texture, and thixotropic effects on time domain reflectometry (TDR) measurements of water content in oil sands tailings are investigated. Results indicate that TDR water content measurements are influenced by temperature, residual bitumen, and percent clay in the tailings. A correction of 0.03–0.10/ °C must be applied to the apparent dielectric constant (Ka) to account for the effect of temperature. The Ka-volumetric water content relationships of slurries differ significantly from the commonly used Topp calibration equation. The age of the tailings and the addition of phosphogypsum did not influence TDR water content measurements.

Jan 1, 2013

By V. N. Mackiw, H. Veltman

"A process is described which permits the separate recovery of lead and zinc from complex low-grade sulphide concentrates such as are produced from the New Brunswick type of disseminated pyrite ores. This process calls for the preparation of a lead-zinc bulk concentrate from the original ore by flotation. The bulk concentrate is then oxidized under pressure in autoclaves in aqueous sulphuric acid solution, such as return electrolyte from zinc electrolysis. This yields a zinc sulphate solution and a residue containing lead sulphate, unaltered pyrite and elemental sulphur generated during the oxidation. After the oxidation, the leach slurry is briefly heated to above the melting point of elemental sulphur and then cooled. Thus, pellets containing pyrite and elemental sulphur are formed, and they are separated from the lead sulphate by screening and/or flotation. Laboratory tests have shown that about 95 per cent of the zinc and lead can be separately recovered from complex bulk concentrates. Process possibilities are discussed."

Jan 1, 1967

"RÉSUMÉOn discute les principales sources de dilution au cours d’une exploitation souterraine. Les différentes définitions de la dilution en usage sont analysées. Une nouvelle méthodologie de calcul simplifiée et facile à utiliser dans la pratique minière est présentée. Cette méthodologie permet de remplacer les différentes expressions analytiques en usage par les deux facteurs de dilution seulement : un «facteur de dilution planifiée» lié à la sélectivité d’abattage au niveau de la planification minière et un «facteur de dilution additionnelle » permettant de juger de l’efficacité du contrôle de terrain et de la dilution pendant l’exploitation souterraine. L’application de cette méthodologie donnerait un outil nécessaire aux niveaux de la planification, du suivi des travaux d’exploitation et d’éventuelles études comparatives des coûts entre les différentes situations minières.ABSTRACTThe principal sources of dilution during underground evaluation and mining are discussed, then definitions of ore dilution currently in use are analyzed. These definitions vary depending on the authors. A new ore dilution evaluation methodology is proposed, replacing the ten different analytical expressions by only two: the planned dilution factor related to the stoping selectivity, done at the mine planning level, and the additional dilution factor related to the efficiency of the dilution control measures during stoping operations. The conclusion shows that the use of this methodology would be a definitive asset in planning, in stoping operations follow-up, and in future costs comparison studies between mining operations."

Jan 1, 2001

By P. Langlois, G. Labonté, J. J. Barrett, J. Holmes

"The Voisey’s Bay mill processes a high-grade pentlandite and chalcopyrite ore in a largely pyrrhotite/troilite matrix. From 1994 to 1997, circuit development focused on making a 14% nickel concentrate. When flowsheet development resumed in 2001, the target grade was raised to 20% ni. initially triethylene tetramine and sulfite pyrrhotite depressants were used in a lime circuit, but by recycling process water and the contained thiosalts, the required nickel grade was made without depressants. construction of the mill was fast-tracked, with start-up in september 2005. ramp-up was faster than other recent nickel installations, with tonnage being limited by concentrate dewatering due to higher-thanexpected ore grades.RÉSUMÉ l’usine de traitement de Voisey’s Bay traite un minerai à teneur élevée en pentlandite et chalcopyrite dans une matrice formée surtout de pyrrhotite/troïlite. De 1994 à 1997, le développement du circuit ciblait la production d’un concentré à 14 % de nickel. lorsque le développement du schéma de traitement a été repris en 2001, la teneur cible a été élevée à 20 % de ni. initialement les déprimants triéthylènetétramine et sulfite de la pyrrhotite étaient utilisés dans un circuit à la chaux; cependant, en recyclant l’eau du procédé et les sulfosels qui y sont contenus, la teneur en nickel a été atteinte sans utilisation de déprimants. la construction de l’usine de traitement a été accélérée et elle a démarré en septembre 2005. la mise en opération a été plus rapide que pour d’autres installations récentes de nickel; le tonnage traité étant limité par le séchage du concentré en raison des teneurs de minerai plus élevées que prévu.INTRODUCTIONnickel was discovered on canada’s east coast in the vicinity of Voisey’s Bay, northern labrador, by chislett and Verbiski (Higgins, 2011) while working for Diamond Fields resources in 1993. The ovoid deposit was subsequently delineated in the winter of 1994–1995. By the end of 1995, the ovoid had been well explored, and at that time was thought to have a reserve of at least 30 million tonnes (Mt), with an average grade of 2.83% ni and 2.0% cu (naldrett, singh, Krstic, & li, 2000). Drilling to the east of the ovoid indicated the presence of significant mineralization. in June 1995, inco limited bought a 25% share in the Voisey’s Bay nickel company (VBnc), which was a subsidiary holding company set up by Diamond Fields. inco also bought 8% of Diamond Fields and negotiated the right to sell all the nickel produced from VBnc for 20 years as part of this agreement. in april 1996, inco bought Diamond Fields and acquired the remaining 75% of VBnc shares."

Jan 1, 2017

By M. Mohan Rao

A Sievert ' technique was used. The few determinations made on 10 per cent and 20 per cent V alloys did not show any deviations from Sieverts' law up to I>N2 = 1 atmosphere. The same held true for alloys of 0.2 per cent Ti. Nitrogen absorptions in Fe-Ti alloys, containing from 0.50 to 0.77 per cent Ti at 1,600°C, follow Sieverts' law at low PN2 values, but, due to the formation of a delta titanium nitride phase, deviate from this law beyond critical values of PN2? There is evidence that this phase is Ti1.1N. The behavior observed can be described by the followmg equations: Ti,.,N(o) = 1.7Ti + N K = (fT; ? % Ti)1?7 (f;;.? %~_) = 0.0020 K = fN. %~ = 0.042 '\)-:>N 2 I NTRODUCTJON Nitrogen's solubility in liquid iron-vanadium alloys was investi-gated briefly by Brick and Creevy ( 1), and more extensively by Kash-yap and Parlee (2) and by Pahlke and Elliott (7). Nitrogen's solubility in liquid iron-titanium alloys

Jan 1, 1963

By Terence M. Gordon, Mati Raudsepp, Gregory M. Dipple

Four methods of measuring mineral abundance in a rock are examined for their potential in assaying for high-tech industrial minerals. One method uses X-ray powder-diffraction data and the other three rely on whole rock chemical data and information on mineral assemblages and mineral compositions. All four methods were employed to estimate wollastonite content in diamond drill core of skarn collected as part of an exploration program and are compared to visual estimates of wollastonite content from core logs. These techniques for assaying wollastonite span a considerable range ofaccuracy and expense, and combined, define a non-linear relationship between these variables. Accuracy increases rapidly relative lo expense up to total costs of about $50 per analysis. Assay methods in the $50-100 per analysis range have associated errors of 5-10% relative and probably suffice for most exploration programs. Improvements in accuracy above this level require a much larger investment. The most expensive assay technique (-$300 per analysis) yields the most accurate measurement of grade (relative error -1%). Its application may best be limited to periodic checks on other assay techniques and for fine-tuning ofmineral separation procedures.

Jan 1, 2001

By A. M. Salomon de Friedberg

With respect to impurities, HBM&S' copper smelter, located in Flin Flon, Manitoba, is in an unusual position. In addition to the usual concerns, the fact that copper and zinc production at Flin Flon is closely integrated results in the unique situation where feed to the copper smelter typically contains 7% to 8% zinc. This paper discusses the ramifications to copper smelter operations resulting from the marriage of HBM&S' metallurgical plants. Distributions of impurities (specifically Zn, Pb, Ni, As, Bi, Sb, and Cd) are presented and operating practices designed to reduce the impact of impurities on anode copper quality are detailed.

Jun 1, 1993

By J. L. Thornton

Introduction The importance of coal in our economy is well established, but it may not .be so generally realized how important a part it plays in our daily life. Select a product - any product - and, if it is made in America, bituminous coal has touched it first. Everywhere we will find coal, derivatives of coal, or functions made possible by coal. Apart from the well known major uses of coal for domestic purposes, coking, utilities, railways, and manufacture of steel and cement, there are over 200,000 products derived from coal, from lipstick colours to nylon products and perfumes. An item of interest is the recent action of the Canadian Government in voting $90,000 for development of coal deposits in Yukon Territory to make coal available to the settlers in that area. The value of this move, in case of some emergency, is very evident. Coal in its several stages of formation as peat, lignite, sub-bituminous, bituminous, semi-bituminous, semi-anthracite, and anthracite, has been used for centuries. Coal, as such, was not very well known to the ancients. First reference to "magic stone', or coal, was in 371 BC by Theophrastus, a pupil of Aristotle. This substance was said to burn like wood coal or charcoal and was used by the smiths. The first record we have in modern times was in 852 AD, when sea coal was gathered by the cowled monks of Durham, in Britain, and even at that time a major problem was transportation. Our first record of coal in this continent was near Richmond, Virginia, in 1700. Commercial mining was not under way, however, until 1750. The anthracite fields (presumably in Pennsylvania) were opened in 1793. Even so, there was no extensive mining until about the year 1820. The famous Pocahontas coalfields were opened in 1883. The earliest record of coal mining in Canada is about 1746.

Jan 1, 1950

By S. Onuki, T. Ando, M. Tejima, R. Enomoto, Y. Okada

"Al–Si–Cu–Mg die casting alloys are widely used in the automotive industry, and recent advancements in high pressure die casting technology enable heat treating products to achieve desirable properties. However, CO2emissions associated with die-casting production lines should be reduced to address the global warming issue. In this study, the relation between the microstructures and thermal stability of precipitates formed during isothermal aging at 423, 485, and 558 K of Al-11.0 mass%Si-1.8 mass%Cu-0.2 mass% Mg (JIS ADC12) was investigated using Vickers hardness tests and transmission electron microscopy (TEM). The hardness tests and TEM results showed that Si compounds and Al–Cu compounds enhanced the mechanical properties of the alloy and that the predominant compound affecting the mechanical properties differed between specimens treated at 423 K and those treated at 558 K. Moreover, additional aging at 423–458 K resulted in a material with a Vickers hardness higher than that of the isothermally single-aged material. Differential scanning calorimetry, differential elemental analysis, and selected-area diffraction analysis using TEM suggested that the combination of Al–Cu compounds precipitated at low aging temperatures and Si compounds precipitated during preliminary aging increased the mechanical strength, resulting in a maximum hardness of 130 HV.INTRODUCTIONAl–Si–Cu–Mg die casting alloys have well-balanced mechanical properties, machinability, and cast ability. These alloys are therefore widely used in the automotive industry because of their superior characteristics, accounting for>90% of the aluminum used in die casting production. As a substitute for iron-based materials, these alloys have contributed to the development of lightweight vehicles.Dong et al. (2014) reported that the heat treatment of die casting materials is effective for changing their dimensions under high temperatures as a result of the precipitation of solid-solution elements. Recent advancements in high pressure die casting technology have led to the application of heat treatments of Al–Si–Cu–Mg alloy products to reduce fuel consumption and satisfy customer needs. Although attempts to reduce CO2emissions have focused on fuel consumption in cars and fuel efficiency regulations have become increasingly strict in recent years, CO2discharged from production lines should also be reduced without adversely affecting the properties of the product. Heat treatments for artificial aging after solution treatment (T6 treatment) and after casting (T5 treatment) are CO2discharge sources, which together with a holding furnace account for >80 % of the CO2discharged during the casting process."

Jan 1, 2018

By G. W. Norval, V. G. Papangelakis, G. A. Moldoveanu

Smelting has been the primary method of treatment for refractory copper sulfide concentrates such as enargite (Cu3AsS4), but the pyrometallurgical processing generates elevated levels of volatile arsenic. The present research investigates a novel hydrometallurgical process of oxidative dissolution of enargite at ambient conditions in the presence of chlorine dioxide (ClO2), a very powerful oxidant generated in solution by the reaction between a strong acid (HCl or H2SO4) and sodium chlorite (NaClO2). The effects of initial oxidant concentration, particle size, agitation speed and temperature on dissolution kinetics and copper extraction were investigated. It was found that a stoichiometric ratio of ClO2:Cu3AsS4 = 9:1 were needed to completely and congruently dissolve the mineral with fast kinetics (<15 minutes) under ambient temperature. The dissolution extent (metal extraction) increases with increasing ClO2 concentration and decreasing particle size of solids, but is not influenced by temperature or agitation speed.

Jan 1, 2014

By Xiang Li, Xibing Li

It is paramount that the stability of rock slopes be correctly accounted for under diverse operating and environmental conditions. Owing to different sources of uncertainty entailed in such stability problems, conventional deterministic approach through the calculation of a factor of safety (FOS) cannot reflect quantified uncertainties explicitly and sufficiently. Thus it is highly desirable to invoke the reliability approach to consider uncertainties in a systematic manner. Nowadays, the current design standards have an increasing tendency to ensure rock slope stability by pre-defining a target reliability index (or target probability of failure), viz., the reliability level of a rock slope is pre-set as a target to be satisfied. In such a situation and considering the fact that the FOS used as an indicator of slope performance still has a very wide acceptance, we focus on proposing an inverse-reliability-based methodology which aims at developing a two-fold indicator strategy, i.e., using the FOS and reliability together to deal with slope stability problems. The basic idea behind it is to utilize a so-called inverse first-order reliability method (IFORM) to directly calibrate the FOS provided the target reliability index has been given. In this way, the calibration scheme relating the FOS can be rationally done by not only incorporating uncertainties, but also satisfying a desired level of the prescribed reliability. Based on this, to make the IFORM computationally feasible and also reduce its computational cost, we introduce the response surface method (RSM) to generate a surrogate for the FOS-based limit state function (LSF), considering the lengthy and complicated form of the FOS in some recognized methods (e.g., within the framework of limit equilibrium). Distinguished from the existing RSMs that potential inadequacies may arise, we present an RSM based on a hybrid approach combining support vector machine (SVM; used as a regression technique) and uniform design (UD; pertaining to experimental design). Using a representative example of rock slope stability problem, we demonstrate the feasibility and validity of the developed methodology, during which the associated sensitivity study and further discussion are also performed. By dint of such a methodology, we can establish a link between the conventional deterministic approach and the reliability approach, where a logical and realistic framework is provided, for cases achieving the specified reliability, to assist in selecting the FOS which remains adequate for rock slope stability even in the face of uncertainty.

Jan 1, 2015

By T. L. McCall

A short description of mining practice in the Sydney coal field in general is followed by a discussion of the operations in the No. 12 colliery of the Dominion Coal Company, Limited, as being typical of the trend in operating methods obtaining throughout the field. Development of longwall mining to the present system of three walls in line is outlined, together with a summary of the cycle of operations involved in systematic operation.

Jan 1, 1944

By Sabry A. Sabour

Metal price is among the key variables in the open pit optimization and the economic evaluation process. The common approach to handle metal prices in open pit mine planning is to optimize the ultimate pit and the mining schedules using a fixed, flat metal price. In this respect, metal price is assumed to be known with certainty throughout the entire mine life, which in some cases can reach 80 years. Given the volatile nature of metal markets and the metal price cycles, the conventional pit optimization approach may generate sub-optimized mining plans, which results in either extra costs to mining projects or lost revenues, or both. Long-term operational decisions such as future pit expansions, beyond the currently optimized limits, cannot be handled using the pit optimization approach based on flat metal prices. There is a growing interest in the mining industry to model and manage such market uncertainty in the pit optimization as well as the project evaluations in order to maximize the value of mining operations. In this paper, the author will outline a practical approach to optimize the ultimate pit taking into account the volatility and variability of metal markets. The proposed approach uses a combination of the pit optimizer of the commercial MineSight package and a simulation-based economic modeling real options valuation approach employing the least-squares Monte Carlo algorithm. MineSight pit optimizer employs both the floating cone for initial optimization exercise and the standard Lerchs-Grossmann algorithm. In this paper, Lerchs-Grossmann option will be used to generate the pit shells. Real options valuation approach used in this study is based on generating multiple metal price scenarios. Metal price uncertainty is modeled using stochastic metal price models such as the geometric Brownian motion and the mean-reverting process. The mining operational scenarios corresponding to the simulated metal prices are then optimized using the least-square Monte Carlo approach. The objective is to maximize the discounted cash flow value of the project while incorporating the operating flexibility to revise the operating status of the open pit with time as new information becomes available. The focus of this work is on the practicality of the proposed uncertainty-based pit optimization approach and the difference it can make to the technical operational mining decisions. A case study of a hypothetical open pit poly-metallic mine is provided. The deposit contains copper, gold and silver grades. The run of mine ore is sent to the process plant that produces copper concentrate with copper as the main metal and gold and silver as the by-products. Four uncertain variables are considered here include copper, gold, silver prices and foreign exchange rate. Both copper price and exchange rate are modeled using the mean-reverting process while gold and silver prices are modeled using the geometric Brownian motion. The case study is performed using both the conventional flat price pit optimization approach and the proposed uncertainty-based one to compare results.

Aug 1, 2013